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Elective Report


Mining Policy Framework A Comparative Study

Submitted by:

Guided by-

Ms Savita Dahiya

Dr. Sanjay Srivastava

IFS (P), 2013-15 Batch

Additional Professor

Rajasthan Cadre


Declaration of Originality

I, Ms. Savita Dahiya, hereby declare that the report being presented here is first
hand perspective and due acknowledgement is given for the sources referred.

Savita Dahiya
IFS(P), Rajasthan Cadre

Declaration by the Guide

I, Dr. Sanjay Srivastava, hereby declare that the work on the topic has been done
under my supervision.

Dr. Sanjay Srivastava

Additional Professor
IGNFA, Dehradun

Table of Contents
Objectives of Study


Type chapter title (level 2)

Type chapter title (level 3)
Big Policy Dilemma


Type chapter title (level 2)

Type chapter title (level 3)


Minor Minerals & Forest Conservation

Finding a Common Ground

Objectives of the study

This elective study involves:

Brief study of existing legislative gaps in mining policy framework in

India vis-a-vis environmental regulation with focus on exploration of
minor minerals.

Comparative study of environmental legislation w.r.t. mining in various


Suggested best practices that may be incorporated in environmental

management in mining rich areas to evolve sustainable development
framework for mining in country.

Materials and Methods

Method of study is primarily the literature survey and review of existing

standard literature on the subject. The study may be extended further
with availibilty of more literature and hence provides platform for future
work which may be undertaken whenever time permits.

Chapter 1


Man is preceded by Forest but followed by Desert, says Graffito




Mining is the primary source of important metals and minerals for areas
ranging from traditional construction to green technology. Yet mining is
also associated with a number of negative consequences, such as large
quantities of waste, emissions to water and air, and noise. Common
concern for the environment has led to a convergence of mining laws; not
only in the Nordic region, but globally. The extensive amount of EU
directives in this area illustrates this. This is reflected by the mineral
strategies adopted by many countries in recent years.
India is also endowed with abundant mineral resources and most of these
resources are located in nationally protected areas, which establishes a
fundamental conflict between the goals of promoting the development of
our domestic mineral/ energy supplies and
the preservation of our national treasures
environmental activism, the Protected Area
Network is expanding. This will further
enhance the conflict as developing economy
needs more natural resources to sustain GDP
It has been argued that area earmarked for the extraction or mining had
already been degraded and that the economic value of mining outweighs
its negative effects. On the other hand, majority of these forest reserves
sit on minerals; therefore if permits are offered to mining companies, all of
the nation's forests will be degraded. The Forest Service promulgated
regulations to deal with the increase of environmental mishaps
attributable to mining in the national forests.

Figure 1 Summary of Gamut of Laws Governing Mining Sector (List if nonexhaustive)

National parks, nature reserves, and other protected areas (PAs) are the
foundation of global efforts to conserve biodiversity. Today, more than
122,000 nationally designated PAs cover approximately 12% of the earth's
land surface and another 0.65% of its oceans (Wood et al. 2008; IUCN and
UNEP 2009; United Nations 2009).
It is normally assumed that PAs are permanent fixtures on the landscape,
but recent evidence points to widespread downgrading, downsizing, and
degazettement of PA (PADDD). Though the conventional pattern regarding
PAs is one of continuous growth in numbers and spatial extent (Figure 2),
several countries have scaled back their national PA systems. Recent
government proposals like downgrading Amboseli National Park (Kenya)
and the Arctic National Wildlife Refuge (ANWR) (USA) are few examples.

Figure 2 - Cumulative growth of nationally designated protected areas (PAs),

18722008 (UNEP-WCMC 2009 ).
Note: Graph excludes 52,932 PAs for which date of establishment is not specified within the World Database of
Protected Areas.

The dilemma and related debates pertaining to mining and forest

conservation are getting deeper everyday, capturing substantial space on
print and electronic media. This has served as a motivation to delve
deeper into the problem of conservation versus mining, world over.


As per Economic Survey, 2015 published by Government of India, the

extent of stalled projects in India accounts to 7-8% of GDP, most of which
are due to lack of environmental or forest clearance. These include more
than 40 stalled mining project due to non-grant of statutory clearances.
The report published by Kalpavriksh, 2003 named Undermining India
Impacts of mining on Ecologically Sensitive Areas states that at least 90
sanctuaries and National Parks and many other Ecologically Sensitive
areas in the country are threatened by existing or proposed mining
activities. The Parliament enacted the Forest Conservation Act, 1980 (the
F.C. Act) for conservation and check further deforestation of
forests. Mining activity is a non-forest activity. Even if there be
a mining lease in favour of an entity under the M.M. Act, mining cannot be
done within a forest area unless there is prior approval from the Central
Government under the F.C. Act and possession is handed over by the
In general Indian policy framework in last few years has been very
dynamic and progressive especially in mitigating socio-economic
resistance. For
instance, in
prior informed
recommendation/ consent of Gram Sabha for minor minerals before
starting process of land acquisition. This is also being brought in case of
major minerals also, proceeded by consultation and disclosure process.
Identification of no-go areas in Coal Blocks allocation is a breakthrough
CPCB in collaboration with SPCBs, research and academic institutions in
early 1990s envisaged preparing District Zoning Atlas project, which aims
to assign and identify areas for different categories industries at district
level (Red, Orange and Green category of Industries).
However there are some major problem areas that requires attention viz.
o Social Impact
o No disclosure of SIA and SMP reports to community as part of
disclosure of public consultation.
o Social Impact Assessment is currently mandated under EIA
notification 2006, during diversion of forest land under Forest
Conservation Act, 1980 and under National Policy on Resettlement &
rehabilitation 2007 (triggered when more than 400 people are


displaced for a project). However, projects do not need a separate

permit/ clearance on basis of social impacts.
There is hardly any incentives for involvement of local community in
continuous EIA during life cycle of a mine
Due to inadequate capacity building of government agencies like
Indian Bureau of Mines (IBM) in terms of technical know-how and
understanding of environment and impact assessment limits their
ability to undertake and monitor scientific mining.
Enforcement is the key drawback in regulatory arrangements
despite having one of the most progressive mining and
environmental laws in the world. One glaring example of several
violations and levels of illegality is seen in Hospet - Bellary in
Karnataka, in terms of boundary violations, over-extraction, underreporting production and export.
There should be proper mapping of viable mineral ore bodies
through systematic assessment.

o Problem of Small Mining Lease and Minor Minerals

o Mining Lease smaller than 5 Ha in size, irrespective of mineral, type
of method or mineral location; is not subjected to careful
environmental scrutiny or appraisal by concerned mining
authorities. There is limited or no capacity of undertake proactive
comprehensive regional planning exercise that takes into account
accumulates impacts and risks.
o Artisanal & Small-scale Mining (ASM) i.e. mining practised by
individuals, groups or communities often informally and in
developing nations is causing maximum loss to environment. In
Schedule 5 & 6 areas, tribal or local cooperatives are sometimes
given mining rights but due to lack of adequate capacity- building
and no regulation, they are doing huge loss to environment. These
geographic area may be small for mines less than 10 ha, out of
9416 mines (excluding fuel, atomic and minor minerals) in country,
they are about 5345 or 56%. Their cumulative lease area is 21000
ha which is 4% of total mine lease area.


Figure 3

In minor mineral cases, there is no reliable information on physical

distribution pattern of mining lease, where small mines dominate.


Chapter 2

The Big Policy


The ongoing conflict between environmentalist and mining lobby in India

and USA present a contrasting picture with Scandinavian countries
especially Sweden, where a dynamic mining and mineral industry coexists
with a strong national environmental commitment. Swedes and Canadians
manage the seemingly impossible combination of decentralization and
flexibility in environmental regulation with high standards.
The Swedish policy model, as well as Canadian and Finnish models, may
not be applicable to current Indian and U.S. socio-political conditions
because of difference in level of development and population density, but
they offer important perspectives on potential ways to break out of the
current standoff.





Scandinavian nations lack large scale conflicts and are global leaders in
environmental and energy policy. Norway, is the worlds third largest oil
and LNG producer. Finland is the world leader in the enclosed flash
smelting process for copper and other sulfide ores. The technology has
dramatically increased production efficiency and reduced energy
requirements for ore processing, while almost completely eliminating toxic
emissions. The magnetite-producing Kiruna Mine in Sweden is one of the
worlds largest and most modern underground mines.
History of extractive industry regulation and environmental management
in all the Scandinavian countries tends toward broad consensus, with
policies remaining little affected by changes in party control of the
government. Trust in public administrators is strong.

Under Swedens Mining Law, only nine employees work in Bergstaten, the
national mining bureau office within the Swedish Geological Survey. The
office handled 305 mineral exploration leases in 2005 almost double
the total for 2004 and emphaises on efficiency and fair operating
In 1999, Sweden consolidated 15 existing environmental laws into a single
Environmental Code amounting to 164 pages. Permit are granted by
Environmental CourtsPermits are not required for limited exploration
(subject of controversy). Its is obligatory to consult County Board if

exploration alters natural environment. There is decentralization of

environmental governance:
o Permit requests for each type of mining activity (Divided into
Categories) are allotted administrative level corresponding to the level
of hazardous materials involved in the activity. For example, bulk
mineral mining permits are in category C, handled by municipal boards.
o Normal mining exploration (except uranium) is in category B,
corresponding to county boards. Full-scale metal mining requests are in
category A, handled by regional environmental courts. These courts
have advisory and oversight duties in addition to rendering legal
o The government can not permit activity unless approved by municipal
parliament. Special permits are granted if area is designated as
conservation area (Municipal Veto)

One salient feature is case to case basis of application of general

environmental code provisions. If a company can prove that normal
conditions are unreasonable, a balancing environmental operation based
on precautionary principle is allowed under governmental oversight.

If environmental code is expected to be violated, mining licensem ay not

be given even after exploration. So, this serves are an incentive to use
least destructible mining techniques.

There are certain STOP provisions, whereby any activity causing harm to
public health are stopped at any stage.

Key operating principle is that it is difficult for a supervisory body with

limited resources and detailed regulations to achieve better safety than
the operator who takes active responsibility. Sweden has exceptionally
high public environmental awareness and standards, which the
government proposes further extending to meet 19 national
environmental goals, along with the requirements of membership in the
European Union.

Mining accidents and failures, well-publicized and analyzed when they

occur, are rare. Companies are required to clean up environment postoperations. However, an example of failure is the clean-up of the Blaiken
mine, in northern Sweden, which two bankrupt companies left to the
state, will cost around 23m]. In 2008, the Swedish Environmental
protection Agency estimated that the current cost of cleaning up former
mines and processing their waste would amount to between 230m and
350m. Further, There is threat to tourism and Lapland and Sami
indigenous communities who live by reindeer herding and fishing by
polar mining boom, which mirrors the oil industrys search for oil and gas.

Denmark extractive industry is focused mainly on nonmetallic minerals

including salt, stone, gravel, sand, chalk and limestone, which are used
primarily in building and construction projects in Denmark.

Mining in Finland is governed by EU pollution laws but supervision and

control of the industry is poor and government has often failed to monitor
or act because the industry and the authorities are closely and intimately
linked. Authorities are understaffed and underfunded
Greenland is an outlier in terms of legislation. There are no large-scale
active mines in Greenland today, Its Mineral Resources Act includes
provisions for prospecting permits and small-scale exploitation licences,
unlike the other Nordic countries. Furthermore, Greenland demands that
permit applicants conduct not only an Environmental Impact Assessment
(EIA), which we will look at next, but also a Social Impact Assessment
(SIA). Also, licences are generally contingent on agreement on an Impact
Benefit Agreement (IBA).






The Canadian National Environmental Protection Law of 1999 is the

overriding national legislation, supplemented by laws dealing with special
issues such as the Arctic and fisheries. In Canada, mining plans now
require land restoration plans, and most provinces require bonds to
ensure restoration in the case the operating company goes out of
Canadian system emphasizes decentralized management with intensive
consultation among stakeholders (including the federal government). The
system includes special environmental courts and has relatively low levels
of litigation.
Australia has 14 Commonwealth laws regarding environment, with states
having an additional five to 15 laws each. A private environmental
organization, Minewatch, monitors both nations mining interests and
raises alarms at intervals.





As a policy, mining was earlier not accepted in any forest reserve in

Ghana. The fact that mineral resources are located beneath rich biological
resources designated as forest reserve posed a dilemma to the Ghanaian


Government. In mid-2003, the Government cleared the air and announced

limited mining in some selected forest reserves.
It was estimated that less than 1% of forest reserves will be affected. The
impact of mining on the reserves should therefore be insignificant. The
benefits of mining in the areas concerned in terms of jobs and local
infrastructure support would outweigh the environmental consequences.
Furthermore, the use of modem technology would minimise the effects of
the mining. All these factors notwithstanding, the companies are
mandated to undertake environmental and social impact assessments
prior to the grant of the mining lease.
One peculiar requirement in granting mineral concession include the prior
forestation of an area of the size of the proposed mining area and
reclamation, rehabilitation and reafforestation of the affected area after
the extraction. The goal is to restore the degraded forest. Though there is
presently no requirement for financial assurance for the rehabilitation of
sites in Ghana. Therefore, in a situation where a company goes bankrupt
or displays financial incapacity to reclaim and reafforest, public funds
might well be the last resort to finance the clean-up. (Citation: 22 J.
Energy & Nat. Resources L. 241 2004)




There are many similarities between Indian and USAs mining policy and
conflict landscape. The National Forest System includes 155 National
Forests consisting of 191 million acres. These lands encompass about 10%
of the land area of the United States. More than 7 million acres of land
within the National Forest System contain coal reserves. There are a
limited number of surface and underground coal mining operations
currently existing within the boundaries of the National Forests.
There are rigid laws and long court battles which has more rift between
general public and conservationists. The Endangered Species Act, for
example, places severe restrictive measures on any public or private land
that contains listed species or sensitive habitats, which may give
landowners strong disincentives to identify endangered species or critical
habitats. In a recent incident, controversy erupted over closure of large
lumber areas in the Northwest because they were habitat for the spotted

Status of Forest Conservation A Framgmented Approach

o National Park System consists of 361 areas covering more than 80
million acres. These areas are of such national significance that

Congress established the National Park Service as a separate

agency. It has been estimated that slightly more than 1 million acres or
1.3% of all National Park areas contain underground coal.
o The National Wildlife Refuge System consists of approximately 89
million acres of land managed chiefly for the conservation of wildlife.
Approximately 3.2 million acres or 3.7% of the Wildlife Refuge System
contain coal reserves. There are no existing surface coal mining
operations reported within the boundaries of the National Wildlife
Refuge System.
o The National Trail System is a cooperative program between federal,
state, and local agencies which establishes scenic trails, preserves
their natural setting, and protects them from incompatible
development. No surface coal mining operations are reported within
their boundaries.
o The National Wilderness Preservation System, managed by a variety of
federal agencies. Activities within a National Wilderness are restricted
and the goal is to maintain them in a primitive state, largely untouched
by human activities.

Role of Forest Service

Even though the Forest Service regulates much of the mining in the
national forests, its regulation of mining is not exclusiveits jurisdiction
overlaps with that of the Bureau of Land Management. While prospecting,
locating, and developing of mineral resources in the national forests may
not be prohibited nor so unreasonably circumscribed as to amount to a
prohibition, the federal court stated that Secretary may adopt reasonable
rules and regulations which do not impermissibly encroach upon the right
to the use and enjoyment of placer claims for mining purposes.
Forest Service has authority to require mining operators to comply with
environmental regulations to help preserve forest resources. Although the
regulations do not specifically mention prohibition of mining operations,
modern problems may force the Forest Service to take this more activist
regulatory stand.
The recent New World mine project controversy (just outside Yellowstone
National Park) and the Gallactic Mine disaster in Colorado exemplify the
need for a strong Forest Service policy to preserve and protect forest
ecosystems. However, court's limited interpretation of the Forest Service's
authority in these cases, to restrict mining, the Forest Service regulations
have remained nearly untouched until the present day.

Regulations require that a prospective miner file a notice of intention to

operate with the Forest Service District Ranger if the proposed mining
operations might cause disturbance of surface resources. A miner can
dispense with filing even a notice of intent: where a plan of operation is
submitted in lieu of a notice of intent; or for operations that will not use
mechanized earthmoving equipment. All mining operators who the Forest
Service requires to file a plan of operations must file a bond conditioned
on compliance with all environmental regulations prescribed in the
Forest Service officer may ask the operator to furnish a proposed
modification of the plan of operation during any time of the operations
and may request a modification of the operation plan if the circumstances
demand a modification.
During mining operations, the regulations require that Forest Service
officials periodically inspect the mining operations to ensure compliance.
However, there is no provision in the regulations to shut down or
terminate mining operations.
Forest Service's inability to prohibit destructive mining
handicaps its function of managing forest surface resources.



Chapter 4

Minor Minerals and Forest


Union government has recently declared 31 major minerals as minor

minerals, which has totalled minor minerals as 54. Mining lease for
these minerals and to formulate regulations is exclusively the domain of
state govt. Study of these minerals assume significance as many of
these mining areas overlap with forest areas. Environmental Impact
Assessment Notification of 1994 did not apply earlier to the mining of
minor minerals. However, minor minerals were brought under the ambit
of the Environmental Impact Assessment Notification of 2006 with a
lease area of 5 hectares and above require prior environmental
In most of the countries, the extraction of minor minerals remains either
with small, unorganised commercial sector or with community. Due to
lack of strong regulations, exploitation of these minerals is causing
degradation of natural resources. India has emerged as a pioneer in
regulating minor mineral mining by means of legislation through judicial
pronouncements. Some of the Landmark judgements and their findings

The illegal uncontrolled limestone mining and deforestation in

Doon Valley has stripped bare of its green cover, which is 10% of
the area today while decades ago it was 70 %. The case of Rural
Litigation and Entitlement Kendra, Dehradun v. State of
UP, is a very significant case in the history of environment
protection movement in India, which totally stopped mining in
these hills.

In Tarun Bharat Sangh v. UOI, SC was made aware of the fact

authorizing mining operations in Reserved Forest Area. SC gave
directions that no mining operations of whatsoever nature shall be
carried on within the protected and reserved forest.

In Ishwar Singh v. State of Haryana, the environmental

damage caused by stone quarrying was highlighted by the Punjab
& Haryana High Court. SC held that there should be one km. safe
distance from a stone quarry or crusher to a lake, water reservoir
and residential locality and it directed the HC to modify its order of
2 kms.

In Deepak Kumar vs. State of Haryana, it was observed that

the size of the Mine Lease area and period of lease vary from state
to state. Mining is considered to be capital intensive industry and

considerable time is lost for developing the mine before it attains

the status of fully developed mine. If the tenure of the mine lease
is short, it would encourage the lessee to concentrate more on
rapid exploitation of mineral without really undertaking adequate
measures for reclamation and rehabilitation of mined out area,
posing thereby a serious threat to the environment and health of
the workers and public at large.
o There is a need to bring uniformity in the period of lease. It
is recommended that a minimum period of mine lease
should be 5 years, so that eco friendly scientific and
sustainable mining practices are adopted.
o Need to develop a cluster-approach in case of smaller mine
leases being operated presently. Further, these clusters
need be provided with processing/crusher zones for forward
integration and minimizing excessive pressure on road
o Requirement of Mine Plan for Minor Minerals:
At present, most of the State Governments have not made it
mandatory for preparation of mining plan in respect of minor
minerals except in few states like Rajasthan. These should specifically
include the provision for reclamation and rehabilitation of mined out
area, progressive mine closure plan and post mine land use.
o Mining of minor minerals, in our country, is by and large
unorganized sector and is practiced in haphazard and
unscientific manner. At times, the size of the leasehold is
also too small to address the issue of reclamation and
rehabilitation of mined outs areas.. There is thus, a need to
create a separate corpus, which may be utilized for
reclamation and rehabilitation of mined out areas on the
basis of `polluter pays' principle. An organizational structure
may also need to be created for undertaking and monitoring
these activities.
o Detailed hydro-geological report should be prepared in
respect of any mining operation for minor minerals to be
undertaken below groundwater table to put restrictions on
depth of mining from case to case basis.
o Environment damage being caused by unregulated river bed
mining of sand, bazari and boulders needs strict moniroring
w.r.t seasonality of extraction and place of mining and
should be restricted to 3 m depth.
The State of Haryana and various other States have not so far
implemented the above recommendations.


Chapter 5

Conclusion: Finding Common


Historical and ongoing conflict between mining mineral reserves and

conserving environmental resources will continue to exist even in future
as Indias forests, mineral bearing areas, major riversheds, tribal habitat
regions and most backward regions overlap significantly. However, by
adopting some management practices, these conflicts can be
significantly toned down in the interest of sustainable development.
Risk assessment of sitting industries
o Categorize mineral resources at state level into high and
low risk groups based on environmental and social
sensitivities. Categorization should be based on impacts like
pollution levels, water quality, health indicators in area
which include potential and ongoing impacts of mining

Using powers vested in Environment Protection Act, 1986,

extend go-no go categorisation and exclude them from
mining consideration and disclose criteria used for

Re-assessment of risks associated with existing lease for

mid-course correction.

Periodic update of social and environment risk database

update at national, state and district levels.

Proactive and Regional EIAs

o In last decade, given the increasing number of critically
polluted areas either due to industrial sector or due to
mining sector. These regional EIAs have been commissioned
more as a reactive management study than proactive
planning strategy. Goa has been advised to commission
NEERI to undertake such comprehensive EIA of mining
activities in state.
o Assessment and Updating Health of Forest/ PAs health
before and during the life cycle of mining and strict
enforcement of Precautionary Principle & Polluter Pays

A Swiss challenge is a form of public procurement in some (usually

lesser developed) jurisdictions which requires a public authority (usually
an agency of government) which has received an unsolicited bid for a
public project (such as a port, road or railway) or services to be provided
to government, to publish the bid and invite third parties to match or
exceed it.
Some Swiss challenges also allow the entity which submitted the
unsolicited bid itself then to match or better the best bid which comes
out of the Swiss challenge process.
It is a form of regulating public procurement.

Adopt Swiss Competitive Challenge & Open sky exploration policy

It is an alternative selection process wherein third parties shall be

invited to submit comparative/ superior proposals to an unsolicited
proposal (1st exploring agency in this case) submitted by a private entity.
Accordingly, the private sector entity that submitted the unsolicited
proposal is accorded the right to match any superior offers given by a
comparative private sector participant.
Various governments are mooting this idea for inviting better terms and
conditions w.r.t environmental governance in mining areas.

Institutional innovations

o Critical and continuous monitoring of standards followed by mining

companies by integration of Remote Sensing and GIS, geohydrological studies with participation from local community, civil
society and environment firms.
o Since small producers, miners sell 'up the value chain' to buyers
who are larger and thus may well be easier for the state to
monitor and thus to regulate. The larger actors could induce
environmental compliance from small miners by sharing more
surplus in bargaining in exchange for shifts in miner behavior that
lessen larger actors' regulatory liabilities. As consumers, smallscale miners value public goods such as improved property rights
and local infrastructure. Therefore, they might be willing to
monitor each other's individual compliance if the level of public
goods provided rises with total regional compliance
o Channelizing CSR funds in environmental regulation monitoring in
forest areas

Incentives to Public Servants especially Forest officers to enhance

vigil and report cases of non-compliance by mining companies

Class action lawsuit in environmental cases can go a long way in

ensuring compliance of laws by authorities as well as industries.




PARKS AND FORESTS, Glen G. Kizer, Dean K. Hunt; Fordham Environmental Law
Journal, 1997
3. A New Look at Mining and the Environment: Finding Common Ground, Frank T.
Manheim, Geotimes
4. Institutional Innovations for Environmental Governance when Monitoring is Limited:
the Case of Small-scale Gold Mining, Luz A. Rodriguez, (Duke University) et al.
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